TARMAC yesterday became the latest UK company to announce job cuts as a result of deteriorating markets.

The company blamed a fall in orders in the UK and overseas for a radical shake-up of its engineering business which will lead to dozens of redundancies.

Tarmac is to merge its civil engineering and international units, with the closure of the international division's head office in Kent. The businesses, which employ 7,800 people worldwide, will be run from the Wolverhampton headquarters of the civil engineering division. Although most job losses are expected from administrative staff, some plant workers were also set to lose their jobs, said sources close to the company.

Sir Neville Simms, group chief executive, did not specify the number of redundancies but said the merger would "inevitably lead to job losses". He said the restructuring would yield cost savings of up to pounds 5m a year and would help the company weather the downturn.

Sir Neville said UK orders had fallen largely as a result of the Government's decision to slash road building.

The company reported a 29 per cent rise in interim pre-tax profits to pounds 49.7m on turnover up 5 per cent to pounds 1.51bn.